Key changes and open questions

Pay range disclosures in job listings

Covered employers under the Act are defined as any “individual, firm, association, or corporation that employs at least one employee in the District,” except for the District or Federal governments. Such employers are required to disclose “the minimum and maximum projected salary or hourly pay in all job listings and position descriptions advertised.” The range must extend from the lowest to the highest amounts the employer believes in good faith it would pay
“for the advertised job, promotion, or transfer opportunity.”

It is unclear whether the Act applies to all external job postings, only job postings with respect to jobs located in the District, or to remote jobs that could be performed within the District. It is also not clear to what extent the Act applies to internal communications regarding job vacancies. However, the Act’s reference to promotions and transfers strongly suggests that pay ranges must be provided for internal job postings (although, again, it is unclear whether this would extend to jobs that are not physically located within the District).

Disclosure of healthcare benefits

The Act also requires covered employers to disclose to prospective employees, prior to their first interview, the “existence of healthcare benefits that employees may receive.” Notably, an early draft of the law would have required employers to give applicants a “schedule of benefits” – a potentially more onerous disclosure obligation. As enacted, however, the Act limits the benefits disclosure requirement to healthcare benefits. Although the Act is silent as to what level of detail must be provided when making this disclosure, it appears that simply stating generally whether healthcare benefits are available, will suffice. The Act does not require any benefits-related information to be provided in job listings.

Limits on inquiries into “wage history”

In addition to imposing new pay and benefits disclosure obligations, the Act restricts employers’ ability to seek and use an applicant’s “wage history,” meaning the “compensation” an applicant has received “from other or previous employment.” For purposes of this provision, “compensation” is defined broadly to include “all forms of monetary and nonmonetary benefits an employer provides or promises to provide an employee.”

In particular, the Act prohibits employers from “screening” prospective employees based on their wage history, including by (i) requiring their wage history to meet minimum or maximum criteria, or (ii) requesting or requiring wage history as a condition of being interviewed or continuing to be considered for a job offer. Further, employers may not request an applicant’s wage history from their current or prior employers.

Unlike “wage history” bans in several other jurisdictions, the D.C. Act is silent as to whether (and, if so, to what extent) an employer may rely on or verify wage history information voluntarily disclosed by an applicant (e.g., to negotiate higher starting pay). 

In addition to the above protections, under existing D.C. law, private employers in the District generally may not prohibit employees from discussing or inquiring about their own wages or the wages of another employee.

New notice obligation

Covered employers are required to post a notice advising employees of their rights under the Act in a conspicuous place in the workplace, “in at least one location where employees congregate.”  It is unclear whether the District will publish a model notice for this purpose.

Remedies

The Act does not create a private right of action but authorizes the D.C. Attorney General to investigate potential violations and bring civil actions for injunctive and monetary relief on behalf of individuals or “the public at large.” In such cases, employers found to have violated the Act are additionally liable for statutory penalties equal to US$1,000 for a first violation, US$5,000 for a second violation, and US$20,000 for each subsequent violation, and for the Attorney General’s reasonable attorneys’ fees and costs.

Next Steps

Employers with at least one employee in the District should prepare to comply with the Act by taking the following actions:

• Review existing internal and external job listings; application forms; and screening protocols to determine a compliance strategy.

• Develop good faith pay ranges for current positions.

• Decide whether to conduct an internal pay equity review or other evaluation of compensation to identify any pay discrepancies and mitigate potential legal risks.

• Consider an external pay benchmarking study, given the increased visibility into your compensation practices.

• Consult with counsel to determine whether any other state and/or local pay transparency laws apply to your organization. The devil is in the details, and compliance with the D.C. Act may not ensure compliance in other jurisdictions.

For more information regarding the Act or pay transparency obligations that apply in other jurisdictions, please contact one of the authors of this article or the Hogan Lovells lawyer with whom you work.

Authored by George W. Ingham, Amy Folsom Kett, and Saydee Schnider.